INSIDE view
HILARY JOFFE: How Comair fell from the sky is a case study of note
There will be many business school case studies to be written as the crisis unfolds, about companies that survived and those that failed, whose strategic choices and cultures made them more resilient - or more vulnerable - in the face of a disaster few predicted. One of those case studies will surely be about Comair, which went into business rescue in early May. Its story is a cautionary tale for all companies, not just for airlines. A company that for seven decades closely tailored its operating costs to its revenues and had never bought a new plane suddenly and unaccountably broke out of its own successful mould.
Under former CEO Erik Venter it went on a spending spree, buying or leasing a fleet of new planes and starting a fleet of new businesses. It more than doubled its debt, and increased debt service costs tenfold, over the four years to December 2019 - in an industry where debt is the downfall of many...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.